Madam Speaker, one year ago Canadians sent a clear message to Ottawa that they were tired of the status quo, hypocritical politicians. They subsequently voted in 205 rookies to the 35th Parliament. My speech is to the rookies. My message: Let us not let the veterans corrupt us.
When the voters fired the former frontbenchers, former backbenchers and former prime ministers, they took away their power but for most not their paycheques. We will be paying them for the rest of their lives millions of dollars. We as taxpayers will be paying 30 per cent of the average of the last six years of their salary.
The issue before us today is the MP pension plan, technically described as the members of Parliament retirement allowance and retirement compensation allowance. Combined, the two plans force members to contribute 11 per cent of their salaries toward their retirement, or should I say toward an annual annuity one month after they leave public office regardless of age.
The result is a plan that is fully indexed, completely immune to inflation and payable for life with only six years of service required. Not bad. A lifetime annuity worth about $19,000 plus, and a minimum collectable whether you are 35, 25 or 65 years of age or over just 2,100 days on the job.
For an MP to receive such a generous amount after only six years of service is ridiculous. The Government of Canada must contribute 5.85 times what the members put into the plan to meet the payments. I would suggest that in the very near future this ratio will continue to rise as more and more MPs are retired when voters vote with their feet, unless members pay more into the plan.
I submit this is why so many Canadian taxpayers are upset with MP pensions, considering them both unfair and unrealistic. What plan anywhere in the private or public sector in Canada or in any of the other G-7 countries that this government so proudly likes to compare itself to has such an overly generous matching amount from the government side?
In the name of justice and fairness I urge the government to correct this inequity immediately. What I am saying today is no different from what the Prime Minister when he was leader of the opposition said on August 13, 1993: "We will change the MP pension in one day". He has been here for one year and he has not done a thing except talk about changing double dipping and raising the age.
If that is all he is going to change, it is not enough. It is the overly generous matching contribution by the government that is annoying to the taxpayers of this country. That is what we cannot get through the heads of those Liberal members on the opposite side. I plead with them to show some leadership by example like Reform Party members.
We have all pledged not to take an MP pension in its current form. Yes, we pledged. The Liberals who are here can laugh, but we have pledged that because we want to show leadership by example. Some of us want to opt out of this current type of plan, but the fact is the government will not let us.
Many of us whether we can afford to or not have also taken a 10 per cent pay cut. It is not because MPs make too much money, but because as leaders we know that Canadians will need to sacrifice in the near future and we are prepared to lead by example at the top. Whether it is one of us, 52 of us or 35 of us is not the issue. As long as there is someone willing to lead Canadians will have hope. The Reform Party is here to provide
that leadership. We challenge government members to follow our lead, because simply put, it is the right thing for them to do especially when we are asking Canadians to sacrifice.
How can the Minister of Human Resources Development talk about reductions in social spending, welfare, education and UI without mentioning his own unemployment insurance scheme, the MP pension plan? What will he reduce there?
How can the minister complain about 25,000 auto workers withdrawing $70 million annually from the UIC fund when taxpayers paid out an estimated $158 million in 1992 to cover revenue shortfalls in the MP pension plan to which the Liberal member pointed out earlier we contribute 11 per cent? That is not enough for what you get out. It is topped off in excess of $2 million every year to do exactly what the Minister of Human Resources Development is criticizing the auto workers for. That is hypocrisy.
How can the Minister of Finance talk about taxing RRSPs without addressing his own retirement compensation allowance that taxpayers fund more than he does on a disproportionate basis which is not even allowed in the private sector? This is a minister of the crown.
The hypocrisy of the Liberal government on this issue is truly disheartening. It promised to address MP pensions. It promised to let us opt out and it has not. It has had the report in hand since March with specific recommendations but has done nothing. Instead it has waited for 52 more MPs, 46 of whom are Liberal, to qualify for the golden parachutes.
The majority of Reformers who have taken a 10 per cent pay cut are also denied access to the 11 per cent the government takes out of their pay to fund retired MPs pensions. That is 21 per cent or over $1,000 a month less than any one of the Liberal members opposite get in their paycheques every month. That is what we are sacrificing to show leadership to the country to get everybody to participate in the deficit reduction program.
The government is hurting our cash flow and all its members do is laugh. Well, let them laugh because he who laughs last laughs hardest. Is it any wonder then why some of us on this side of the House question the blindness and stupidity of the government on this issue?
Let me outline the Reform Party's position on MP pensions. We would end full indexation of these pensions. We would postpone eligibility for benefits until at least age 60, with eligibility further postponed by the amount of time in which the person has already been paid prior to age 60. We would also subject the MP pension plan to a tax back according to a formula identical to that of the old age security program.
The Reform caucus has already approved the concept of privately purchased MPs pensions under which future RRSP contributions for sitting MPs would be matched by the government up to the legal limit for contributions. After eliminating the gold plated pension plan this House could agree to a proper and balanced compensation package that would be more palatable and compatible with Canadian taxpayers.
Here is my personal recommendation, which is certainly debatable, but should satisfy our critics and possibly have all the rookies in this House vote in favour of our motion: Individual citizens from time to time wish to enter the public sector to help shape legislation and make a contribution to Canadian society. It is desirable to attract individual citizens from all walks of life to Parliament regardless of income. Therefore, a reasonable compensation package should be offered so as to have this great institution in the hands of members of Parliament more interested in serving their country rather than for the pay, perks and privileges without inflicting undue financial hardships.
This is an important job. Only 295 people in Canada have it at any given time. They must balance personal sacrifices with the public interest. Given the current job description of an MP and people's expectations let us get rid of the impression that MPs are somehow special, different, or somehow deserve something that is not available in the private sector.
Let us get rid of the notion that MPs are paid just $64,000 per year. They are not. They are paid much more. It is confusing. They have $64,000 in salary. They have a tax free living allowance of $21,300 and a tax free expense allowance of $6,000. After six years they get a bonus, a pension for life. They get $27,000 tax free. Why?
For someone in the private sector to earn $27,000 they have to make $50,000 plus. This sort of pay structure is nothing more than planned deception. It gives the Prime Minister the ability to say he makes less than the lowest paid Ottawa Senators hockey player. A member of Parliament's total salary is about $120,000 per year if we mark up the tax free portion. This is the kind of double talk that makes people lose respect for politicians.
The Liberals are in power and the Deputy Prime Minister of Canada supports the GST. She said during the election campaign that if the GST was not scrapped she would resign. They have promised to do it by January 1996. I promised to take a 10 per cent pay cut. I did. I promised to opt out of the current pension plan. I will. I promised to take the 10 per cent pay cut for the full
term. I will. Perhaps the Deputy Prime Minister can learn from this what it means to keep a promise. Will she keep her promise and resign on January 1, 1996 if the GST is not scrapped?
This job itself with its responsibilities compared to the private sector is at least at a senior executive level and is deserving of a $6,000 to $7,000 salary per month. We should get rid of the MP pension plan, the tax free living allowance and the tax free expense allowance, limit members to two terms and offer the following: A taxable salary of $10,000 to $12,000 per month where members look after their own expenses and their own pensions. The $10,000 per month is the current minimum as it reflects basically what MPs are paid now after we mark up the tax free aspects.
I personally believe that MPs should be paid more. However once they are removed from office Canadians should not be on the hook for about $1 million per year per member. They should be given a private sector pension plan to which they pay 5 per cent, matched by the government on a 1:1 basis as opposed to 6:1 as is currently the case. Upon departure after two terms or whenever members would get a one time, one year severance to help re-enter the workforce and reintegrate their previous lives. This is more in line with the private sector and should make the voters and the politicians more respectful of each other.
Madam Speaker, may I ask for unanimous consent to continue for one minute? I have just three more paragraphs.
